Jan

6

The scent of money

January 6, 2009 posted by indiatime |

Reading about some tough and bearish predictions about India’s stock market in 2009, I couldn’t help thinking how unpredictable the Indian scenario really is. Unpredictable it may be, but I do not believe it is as gloomy as some would think it is.

Most of the current assessments are based on the usual suspects such as high P/E ratios, high P/B ratios, low dividends, market capitalizations to GDP ratios, decline in foreign capital inflow, etc. Add to that uncertainties with the political climate, impending elections, war on terror, winter fog, and what not. Then add all the negative news about potential decline in outsourcing jobs to the US. For most investors, that is definitely not the rosy scenario they have been used to for last few years.

I am, however, going to predict a much more positive picture for the Indian market. Partly because I believe the global downturn accords India some unique possibilities and opportunities that were never encountered before. And partly because I believe the Indian market is more resilient than most foreign markets because of the Indian investor.

Where foreign experts predict uncertainty due to an election year, I want to stress that this election year will bring another round of democratically elected government, once again asserting India’s political stability even in the midst of geopolitical uncertainties in the subcontinent. No matter how concerned the foreign investors are at this moment, there aren’t many places else where smart foreign investors would rather be than here.

Are the Indian investors up for a few heart attacks? Sure, they are. But those who have not put their eggs in one basket, and those who have left some liquid assets that can suffice for a year or so, will find that bear markets like these are goldmines if you learn to find your nuggets. I bet you there are more than a few of those nuggets in the Indian market today. Take some time to make your mind up with the sector that you understand a little about.

Within the next year, I plan to make you aware of some of those nuggets. I also plan to make you aware of your own potential as innovators and inventors and ways to go about executing those plans. We’ll talk about ideas, business plans, venture firms, all that exciting stuff. We’ll also talk about individual finances, credit cards, and ways to beat the credit demons. I promise not to make it a boring, number-crunching exercise. And I promise not to indulge in any unethical bank-breaking ideas. And along the way, we’ll also talk about giving and philanthropy, which is an absolutely essential habit for everyone.


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